Cash prices either remained flat or rebounded a cent or two atmost delivery points across the board on Friday, mainly as resultof recent forecasts of above normal temperatures throughout thecountry, and the fact that the relatively low prices made for anattractive storage play opportunity. In addition to minor losses inthe Northeastern markets, Western and Rockies points, whichdemonstrated the most strength during the past week, alsoregistered declines of between 1-4 cents.

Most sources agreed that the current price levels made for avery attractive opportunity for those with storage flexibility tostep up and buy the cheap gas in hopes of locking-in some profitlater on. This has tempted many players who have been mostlysellers for the first half of the month to step up and buy in orderto take advantage of the price situation.

Traders expect prices to continue upward this week as theweather factor comes into play. “We could very well see a sizableincrease in demand [this week],” said a Gulf Coast trader whoattributed Friday’s strength to the upcoming weather. The mostrecent six-to-ten day forecast by the National

Weather Service for July 23 to July 27 calls for above normaltemperatures for over half of the 48 contiguous states, much abovenormal temperatures for most of the Midwest, parts of the Rockiesand Northern Texas, and near normal temperatures from the SouthernCalifornia Coast northward through central Nevada as well as overNorthwestern Washington.

“Rockies prices are still strong for a weekend,” said an areamarketer. “What happens most weekends is that prices in the regionget crushed, usually losing about a nickel to a dime.” The traderadded this minor decline is actually indicative of strength,especially since utilities aren’t usually buying at that time.

San Juan Blanco prices remained flat as work continues on the ElPaso Chaco Plant (see Daily GPI, July 14) which is still 100 MMcf/dbelow its 900 MMcf/d capacity. El Paso anticipated work to becompleted by the end of this past weekend. A company spokesman saidthat two additional compressor station outages are also in effecton the system.A compressor at the White Rock station in the SanJuan Triangle is curtailing 160 MMcf/d off the Basin’s supply, anda compressor unit at Belen at the San Juan crossover is running at85 MMcf/d below regular capacity. The overpull penalty situation onEl Paso’s Washington Ranch storage facility and South mainline isalso in effect until further notice, the spokesman said.

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